The moment that you know you’re headed for a divorce, you have to start thinking about all the practical concerns that come with a split: How will your assets and debts be divided? How will the custody arrangements work, if there are children involved? Will you need to pay or receive alimony?
What you may not immediately consider, however, is your insurance coverage. Here’s what you need to know to be prepared:
While your divorce is pending
It’s not uncommon for one spouse to carry health insurance for the entire family, even if the spouse is otherwise employed. When a divorce begins, however, it’s common for automatic temporary restraining orders to be put into place. Those orders aim to maintain the “status quo” for the family, as much as possible, until all the issues involved in the divorce are settled.
If you’re paying for family insurance, this means that you cannot remove your spouse or children from your medical plan during that time. If you’re covered under your spouse’s insurance, this means you won’t immediately lose your coverage.
When your divorce is over
Everything changes once a divorce is finalized. The moment this is true, an ex-spouse is no longer considered “family.” Once that happens, an employer will generally refuse to cover the ex-spouse in question. (The divorce doesn’t affect the right for an insured parent to keep their children on their coverage through family insurance, and that parent may be required by the court to do so.)
If you’re dependent on your spouse’s insurance, this means that you may face a coverage gap until you can secure coverage on your own through an employer or on the open marketplace, although you do have the right to elect to continue your coverage under your spouse’s plan at your own cost, thanks to the Consolidated Omnibus Budget Reconciliation Act (COBRA) for up to 36 months.
It’s important to note, however, that you have to pay the full premium, without any employer contribution, so many people find this cost-prohibitive.
Insurance considerations are just one of the many things that should be taken into account when negotiating your divorce settlement. Whatever side you’re on, you want to aim for the least financially burdensome solution.